PRICE T ROWE CAPITAL APPRECIATION FUND
497K3B, 2000-10-13
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                                                             October 1, 2000
FUND PROFILE
T. ROWE PRICE
Capital Appreciation Fund

A relatively conservative stock fund seeking long-term capital growth.
This profile summarizes key information about the fund that is included in the
fund's prospectus. The fund's prospectus includes additional information about
the fund, including a more detailed description of the risks associated with
investing in the fund that you may want to consider before you invest. You may
obtain the prospectus and other information about the fund at no cost by calling
1-800-638-5660, or by visiting our Web site at www.troweprice.com.
TROWEPRICELOGO
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                                                                           1

FUND PROFILE
---------------------------------------------------------
 What is the fund's objective?

   The fund seeks maximum long-term capital appreciation by investing primarily
   in common stocks, and it may also hold fixed-income and other securities to
   help preserve principal value in uncertain or declining markets.


 What is the fund's principal investment strategy?

   We will invest primarily in the common stocks of established U.S. companies
   we believe to have above-average potential for capital growth. Common stocks
   typically constitute at least half of total assets. The remaining assets are
   generally invested in other securities, including convertible securities,
   corporate and government debt, foreign securities, futures, and options, in
   keeping with the fund's objective.

   Our common stocks generally fall into one of two categories: the larger
   category comprises long-term core holdings whose prices when we buy them are
   considered low in terms of company assets, earnings, or other factors; and
   the smaller category comprises opportunistic investments whose prices we
   expect to rise in the short term but not necessarily over the long term.
   Since we attempt to prevent losses as well as achieve gains, we typically use
   a value approach in selecting investments. Our in-house research team seeks
   to identify companies that seem undervalued by various measures, such as
   price/ book value, and may be temporarily out of favor but have good
   prospects for capital appreciation. We may establish relatively large
   positions in companies we find particularly attractive.

   The fund's approach differs from that of many other funds. We work as hard to
   reduce risk as to maximize gains and may seek to realize gains rather than
   lose them in market declines. In addition, we search for the best risk/reward
   values among all types of securities. The portion of the fund invested in a
   particular type of security, such as common stocks, results largely from
   case-by-case investment decisions, and the size of the fund's cash reserves
   may reflect the manager's ability to find companies that meet valuation
   criteria rather than his market outlook.

   Bonds and convertible securities may be purchased to gain additional exposure
   to a company or for their income or other features; maturity and quality are
   not necessarily major considerations.

   The fund may sell securities for a variety of reasons, such as to secure
   gains, limit losses, or redeploy assets into more promising opportunities.

   Further information about the fund's investments, including a review of
   market conditions and fund strategies and their impact on performance, is
   available in the annual and semiannual shareholder reports. To obtain free
   copies of either of these documents, call 1-800-638-5660.
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                                                                               2


                                                                           2

FUND PROFILE
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 What are the main risks of investing in the fund?

   As with all equity funds, this fund's share price can fall because of
   weakness in the broad market, a particular industry, or specific holdings.
   The market as a whole can decline for many reasons, including adverse
   political or economic developments here or abroad, changes in investor
   psychology, or heavy institutional selling. The prospects for an industry or
   company may deteriorate because of a variety of factors, including
   disappointing earnings or changes in the competitive environment. In
   addition, our assessment of companies held in the fund may prove incorrect,
   resulting in losses or poor performance even in a rising market. Finally, the
   fund's investment approach could fall out of favor with the investing public,
   resulting in lagging performance versus other types of stock funds.

   A particular risk of our value approach is that some holdings may not recover
   and provide the capital growth we anticipate. If the fund has large holdings
   in a relatively small number of companies, disappointing performance by those
   companies will have a more adverse impact on the fund than would be the case
   with a more diversified fund. Our opportunistic trading approach and
   willingness to realize gains could result in higher taxable capital gain
   distributions than other stock funds. A sizable cash or fixed-income position
   may hinder the fund from participating fully in a strong, rapidly rising bull
   market. In addition, significant exposure to bonds increases the risk that
   the fund's share value could be hurt by rising interest rates or credit
   downgrades or defaults. Convertible securities are also exposed to price
   fluctuations of the company's stock.

   Foreign stock holdings are subject to the risk that some holdings may lose
   value because of declining foreign currencies or adverse political or
   economic events overseas. Investments in futures and options, if any, are
   subject to additional volatility and potential losses.

   As with any mutual fund, there can be no guarantee the fund will achieve its
   objective.

  . The fund's share price may decline, so when you sell your shares, you may
   lose money. An investment in the fund is not a deposit of a bank and is not
   insured or guaranteed by the Federal Deposit Insurance Corporation or any
   other government agency.


 How can I tell if the fund is appropriate for me?

   Consider your investment goals, your time horizon for achieving them, and
   your tolerance for risk. If you are looking for a relatively conservative way
   to invest for capital growth in the equity market and are willing to accept
   price declines, the fund could be appropriate for you. This fund should not
   represent your complete investment program or be used for short-term trading
   purposes.
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                                                                           3

FUND PROFILE
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   The fund can be used in both regular and tax-deferred accounts, such as IRAs.

  . Equity investors should have a long-term investment horizon and be willing
   to wait out bear markets.


 How has the fund performed in the past?

   The bar chart showing calendar year returns and the average annual total
   return table indicate risk by illustrating how much returns can differ from
   one year to the next and over time. Fund past performance is no guarantee of
   future returns.

   The fund can also experience short-term performance swings, as shown by the
   best and worst calendar quarter returns during the years depicted in the
   chart.

LOGO

<TABLE>
<CAPTION>
  Calendar Year Total Returns
  "90"    "91"    "92"   "93"    "94"   "95"    "96"    "97"    "98"   "99"
 ----------------------------------------------------------------------------
 <S>     <C>     <C>    <C>     <C>    <C>     <C>     <C>     <C>    <C>
 -1.25   21.59   9.36   15.66   3.80   22.57   16.82   16.20   5.77    7.07
 ----------------------------------------------------------------------------
</TABLE>


          Quarter ended              Total return

 Best quarter                            3/31/91 12.22%

 Worst quarter                           9/30/90 -9.90%


<TABLE>
 Table 1  Average Annual Total Returns
<CAPTION>
                                         Periods ended 09/30/2000
                                       1 year    5 years     10 years
 ----------------------------------------------------------------------
 <S>                                  <C>       <C>        <C>
  Capital Appreciation Fund            11.40%    12.25%       13.80%

 ----------------------------------------------------------------------
  S&P 500 Stock Index                  13.28     21.69        19.44
  Lipper Mid-Cap Value Funds Average   24.24     13.66        14.99
 ----------------------------------------------------------------------
</TABLE>



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                                                                               4


                                                                           4

FUND PROFILE
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 These figures include changes in principal value, reinvested dividends, and
 capital gain distributions, if any.


 What fees or expenses will I pay?

   The fund is 100% no load. There are no fees or charges to buy or sell fund
   shares, reinvest dividends, or exchange into other T. Rowe Price funds. There
   are no 12b-1 fees.


<TABLE>
 Table 2  Fees and Expenses of the Fund
<CAPTION>
                                               Annual fund operating expenses
                                        (expenses that are deducted from fund assets)
 -------------------------------------------------------------------------------------
 <S>                                   <C>
  Management fee                                           0.62%/ // /
  Other expenses                                           0.26%
  Total annual fund operating                              0.88%/ // /
  expenses
 -------------------------------------------------------------------------------------
</TABLE>


   Example.  The following table gives you a rough idea of how expense ratios
   may translate into dollars and helps you to compare the cost of investing in
   this fund with that of other funds. Although your actual costs may be higher
   or lower, the table shows how much you would pay if operating expenses remain
   the same, you invest $10,000, earn a 5% annual return, and hold the
   investment for the following periods:

<TABLE>
<CAPTION>
   1 year      3 years      5 years       10 years
 ----------------------------------------------------
 <S>         <C>          <C>          <C>
    $90         $281         $488          $1,084
 ----------------------------------------------------
</TABLE>



 Who manages the fund?

   The fund is managed by T. Rowe Price Associates, Inc. Founded in 1937, T.
   Rowe Price and its affiliates manage investments for individual and
   institutional accounts. The company offers a comprehensive array of stock,
   bond, and money market funds directly to the investing public.

   Richard P. Howard manages the fund day-to-day and has been chairman of its
   Investment Advisory Committee since 1989. He joined T. Rowe Price in 1982 and
   has been managing investments since 1989.
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                                                                           5

FUND PROFILE
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 Note: The following questions and answers about buying and selling shares and
 services do not apply to employer-sponsored retirement plans. If you are a
 participant in one of these plans, please call your plan's toll-free number for
 additional information.


 How can I purchase shares?

   Fill out the New Account Form and return it with your check in the postpaid
   envelope. The minimum initial purchase is $2,500 ($1,000 for IRAs and gifts
   or transfers to minors). The minimum subsequent investment is $100 ($50 for
   IRAs, gifts or transfers to minors, or Automatic Asset Builder). You can also
   open an account by bank wire, by exchanging from another T. Rowe Price fund,
   or by transferring assets from another financial institution.


 How can I sell shares?

   You may redeem or sell any portion of your account on any business day.
   Simply write to us or call. You can also access your account at any time via
   Tele*Access /(R)/ or our Web site. We offer convenient exchange among our
   entire family of domestic and international funds. Restrictions may apply in
   special circumstances, and some redemption requests need a signature
   guarantee. A $5 fee is charged for wire redemptions under $5,000.


 When will I receive income and capital gain distributions?

   The fund distributes income and net capital gains, if any, at year-end. For
   regular accounts, income and short-term gains are taxable at ordinary income
   rates, and long-term gains are taxable at the capital gains rate.
   Distributions are reinvested automatically in additional shares unless you
   choose another option, such as receiving a check. Distributions paid to IRAs
   and employer-sponsored retirement plans are automatically reinvested.


 What services are available?

   A wide range, including but not limited to:

  . retirement plans for individuals and large and small businesses;

  . automated information and transaction services by telephone or computer;

  . electronic transfers between fund and bank accounts;

  . automatic investing and automatic exchange;

  . brokerage services; and

  . asset manager accounts.
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FUND PROFILE
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T. Rowe Price Associates, Inc.
100 East Pratt Street
Baltimore, MD 21202
www.troweprice.com
LOGO
 RPS F72-035
 T. Rowe Price Investment Services, Inc., Distributor
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